A Healthy Blog

Massachusetts health care — wonky, with a healthy dose of reality

Data Shows that Recession, Not Pharma Gift Ban, is Issue for Restaurants

Data Shows that Recession, Not Pharma Gift Ban, is Issue for Restaurants

June 23, 2010

The restaurant industry and drug and device companies are trying to repeal the Commonwealth's landmark drug industry marketing restrictions. The gift ban prevents drug and device companies from wining-and-dining doctors to get them to prescribe brand-name drugs. Repealing this provision will gut a critical piece of Massachusetts’ cost containment efforts.

Although some argue that the gift ban is crippling profits in the Massachusetts restaurant industry, no empirical evidence has been presented to show that the ban is to blame. The Massachusetts Restaurant Association contends that "the ‘gift ban’ has been devastating to restaurants and thousands of middle-class employees.... Sales at many Massachusetts restaurants dropped at least 10%, while countless others were forced to close.” But the Association offers no data to support this allegation.

We'd like to see the objective numbers, but even if this is true, the reason for the sales drop experienced by Massachusetts restaurants is surely the ongoing economic recession. The losses seen by Massachusetts restaurants mirror similar recession-caused losses in the restaurant industry throughout the country — despite the fact that most states do not have a pharmaceutical gift ban. For example, in April, a trade paper reported that sales were down 10% at the top 100 independent restaurants in the U.S. in 2009. This is in line with the drop that was forecast for national fine dining sales at the beginning of 2009, when the Wall Street Journal reported that such sales were “expected to plummet 12% to 15% in 2009.”

We fully understand the challenges that restaurants are facing in this bleak economy and sympathize with their plight. But the individual patients, who are struggling to afford their prescriptions, and small businesses, which are crippled by the cost of insuring their employees, deserve better. Their healthcare costs are driven up by exactly the sort of conflict of interest that the gift ban eliminates. We cannot allow what is really an attempt to boost pharmaceutical profits to interfere with ensuring affordable, accessible health care for our entire community.

One other thing - if doctors value getting their drug sales pitches over a fancy meal, there's no prohibition on a doctor and drug sales rep dining together at an upscale restaurant. Just ask for separate checks.
-Rosemary Guiltinan